President andCEO W. Robert Berkley observed an incremental increase in competition acrossinsurance markets between the first and second quarters, though he cautionedthat business trends can vary greatly between products.
Speakingduring a conference call, he gave "the stupidity award" to theaviation and global marine hull markets while describing the casualty market as"probably the brightest bulb on the tree."
Berkleyseemed to affirm the commentary provided recently by regardingcatastrophe-exposed property insurance business as he described the business as"surprisingly competitive." He suggested that the reinsurance marketmay be "empowering the insurance market to be less than responsible inmany situations" in that line.
Incommercial auto, a line that gave Berkley "reason for pause" atthe start of the year, the CEO said that disciplined underwriting appears to bereturning to the business.
"Weare seeing rate increases and we are seeing the momentum begin to shift betweensupply and demand," he said.
Theworkers' compensation market "is very much a mixed bag," Berkleysaid. Although some parts of the comp market are characterized by"exceptionally attractive" margins, he observed, other parts"give one reason for pause." The Florida workers' comp market"personally scares the daylights out of me," he added, followingrecent state supremecourt rulings that deemed unconstitutional a mandatory attorney fees scheduleand a 104-week limitation on temporary total disability benefits.
"Theidea of loss costs and what people had thought they were when they priced thebusiness may not prove to be reality," Berkley said. But, he emphasized,the company has "very limited" exposure to the Florida workers' compmarket such that the rulings are "not a big deal for us."